Volkswagen announced that it will invest 180 billion euros (currently about 1.32 trillion RMB) in the next five years for battery production, digital software for the Chinese market and expansion of its In North America business and other fields.
According to the announcement, nearly 70% of the five-year investment budget is used for electrification and digital software, higher than the 56% of the previous five-year plan, of which 15 billion euros (currently about 110.25 billion RMB) are used for battery factories and raw materials.
Volkswagen also said investment in internal combustion engine technology would peak in 2025 and then start to decline, as it works towards a goal of 50 percent of global sales of pure electric vehicles by 2030.
Volkswagen shares soared earlier this month as the automaker was upbeat about its outlook for the year ahead, forecasting a 10-15% rise in revenue and a 14% increase in deliveries despite ongoing supply chain challenges.
While supply chain turmoil dragged its net cash flow well below target, its margins remained at the upper end of its 2022 forecast at 8.1%, with sales and earnings above 2021 levels.
On Monday, Volkswagen also announced that its first battery factory outside of Europe will be in Canada, where production will begin in 2027. Volkswagen board member Thomas Schmall said the automaker was in no rush to decide on the location of its next European plant until it learned about European incentives.